Karachi: It's a busy night at the Prince cinema in the Pakistani city of Karachi with cars parked across the pavement outside and spilling onto a main street.

Movie fans have a rare treat. The Indian film Race is being screened.

Pakistan banned Indian films after going to war with its neighbour in 1965 but over the past few years, as relations between the nuclear-armed rivals have improved, authorities have been allowing a trickle of Indian films to be shown in cinemas. That has delighted movie fans and cinema operators but Pakistani film producers fear a flood of Indian films could mean the end of the local film industry.

"The government must stop the imports. Do you want to make Lollywood a part of the history books?" said Saeed Rizvi, chairman of the Film Producers Association, referring to the Pakistani movie industry, dubbed "Lollywood" because it is based in the city of Lahore.

Pakistan's film industry made about 30 films last year, most of them low-budget imitations of Bollywood fare.

Cinemas have been struggling for years and many operators have given up and sold off their premises which have been converted into shopping centres or offices.

From about 750 cinemas nationwide in the 1970s, there are now 300.

India's film industry, including its Mumbai-based "Bollywood" studios, produces about 1,000 films a year.

Karachi cinema owner Qaiser Rafiq is screening Taare Zameen Par, which is about a boy with a learning disability and was expected to pull in the crowds.

"Look at Hollywood or Bollywood. About 35 per cent of their population watch movies at cinemas. In Pakistan, the best movie so far has only attracted just 4 per cent of our population," Rafiq said.

Cinema operators are cashing in on the revival of interest in the cinema the Indian films have generated. Before screenings of Indian films began, a cinema ticket in Karachi cost Rs100 (Dh6). Now it is Rs150. "Before the release of Indian films, a good Lollywood film would make about [Rs]700,000 in an average week. Now the best week for Race in a Lahore cinema made more than [Rs]2 million," said another cinema manager.

Pakistani film distributors also welcome the revival of cinemas.

"It's a ground reality that Indian movies are very much liked in Pakistan," said prominent film distributor Satish Anand. "[But] we shouldn't become dependent on Indian films."

Culture Minister Khawaja Sa'ad Rafique said he had been meeting the censor board and film producers to work out a policy on films. The government had to "decide between the profit of cinema owners and the future of Lollywood", he said.

"We have to look into the issue very carefully. But one thing is sure, it cannot be one-way traffic," Rafique said.